Aflac Incorporated (AFL) Bundle
A Brief History of Aflac Incorporated
Aflac Incorporated, a leading provider of supplemental insurance in the U.S. and Japan, has undergone significant transformations and growth since its inception in 1955. With its headquarters in Columbus, Georgia, the company primarily focuses on providing financial protection through innovative insurance products.
Company Overview
Aflac operates through two main segments: Aflac Japan and Aflac U.S. As of September 30, 2024, Aflac Japan accounted for total assets of $101.1 billion, while Aflac U.S. reported total assets of $22.5 billion. The company continues to leverage its strong market presence to enhance its product offerings and customer service.
Financial Performance
In the third quarter of 2024, Aflac reported total revenues of $2.9 billion, a decrease from $5.0 billion in the same period of 2023. The net earnings for the third quarter of 2024 were $(93) million, translating to $(0.17) per diluted share, compared to $1.6 billion, or $2.64 per diluted share, in the third quarter of 2023.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Revenues (in billions) | 2.9 | 5.0 |
| Net Earnings (in millions) | (93) | 1,600 |
| Earnings per Share | (0.17) | 2.64 |
Investment Portfolio
Aflac's investment strategy is crucial for its financial stability and growth. As of September 30, 2024, the company’s total investments and cash amounted to $115.6 billion, with the following composition:
| Investment Type | Carrying Value (in millions) |
|---|---|
| Fixed Maturity Securities | 68,261 |
| Equity Securities | 808 |
| Commercial Mortgages and Other Loans | 11,544 |
| Other Investments | 7,647 |
| Cash and Cash Equivalents | 5,612 |
Market Conditions and Challenges
The company faced challenges in 2024, particularly related to foreign exchange fluctuations, which impacted its earnings. The yen strengthened by 12.9% during the third quarter, contributing to foreign exchange-related losses. Despite these challenges, Aflac remains committed to its growth strategies and enhancing customer value.
Future Outlook
As of 2024, Aflac continues to adapt its business model to changing market dynamics, focusing on digital transformation and customer-centric strategies. The company aims to leverage its strong financial position to capitalize on new opportunities in the insurance market.
| Future Commitments (in millions) | Amount |
|---|---|
| Cloud Hosting Services Agreement | 58 |
| Outsourcing Agreement with Technology Company | 320 |
Aflac’s robust financial metrics and strategic initiatives position it well for continued success in the competitive insurance landscape.
A Who Owns Aflac Incorporated (AFL)
Major Shareholders
As of 2024, Aflac Incorporated (AFL) has a diverse ownership structure. The following table outlines the major shareholders and their respective ownership percentages:
| Shareholder | Ownership Percentage (%) |
|---|---|
| The Vanguard Group, Inc. | 8.9 |
| BlackRock, Inc. | 8.4 |
| State Street Corporation | 4.5 |
| Wellington Management Group LLP | 4.0 |
| FMR LLC (Fidelity Investments) | 3.5 |
| Other Institutional Investors | 39.0 |
| Individual and Retail Investors | 27.7 |
Insider Ownership
Insider ownership, which includes executives and board members, plays a significant role in the company's governance. As of 2024, insider ownership is as follows:
| Insider | Position | Shares Owned |
|---|---|---|
| Daniel P. Amos | Chairman and CEO | 1,058,000 |
| Frederick J. Crawford | President | 400,000 |
| Other Executives | Various | 1,550,000 |
Share Repurchase Program
Aflac Incorporated has been actively repurchasing its shares as part of its capital management strategy. In 2024, the company repurchased approximately $2.1 billion worth of shares, equating to 23.4 million shares. As of September 30, 2024, Aflac had 54.3 million shares remaining authorized for repurchase.
Market Performance
As of September 30, 2024, Aflac's stock performance has been influenced by various market factors. The following table summarizes key financial metrics:
| Financial Metric | Value |
|---|---|
| Market Capitalization | $32.4 billion |
| Share Price (as of September 30, 2024) | $87.29 |
| Shares Outstanding | 560 million |
| Dividend per Share | $0.50 |
| P/E Ratio | 13.2 |
Recent Developments
Aflac has continued to focus on expanding its market presence, particularly in Japan and the U.S. As of September 30, 2024, Aflac Japan had over 22 million individual policies in force, with a significant portion related to cancer insurance.
Conclusion
In summary, Aflac Incorporated's ownership landscape is shaped by a mix of institutional and individual investors, alongside significant insider ownership. The company's ongoing share repurchase program and robust market performance further illustrate its commitment to enhancing shareholder value.
Aflac Incorporated (AFL) Mission Statement
Aflac Incorporated aims to be the most trusted name in supplemental insurance, providing peace of mind to policyholders by offering high-quality insurance products and exceptional service. The company focuses on delivering innovative solutions that meet the evolving needs of its customers while fostering a culture of integrity and social responsibility.
Financial Overview as of 2024
As of September 30, 2024, Aflac's total revenues were $13.5 billion for the first nine months, compared to $14.9 billion for the same period in 2023. The net earnings for this period were $3.5 billion, or $6.23 per diluted share, a decrease from $4.4 billion, or $7.28 per diluted share, in 2023.
Key Financial Metrics
| Metric | 2024 (9 months) | 2023 (9 months) |
|---|---|---|
| Total Revenues | $13.5 billion | $14.9 billion |
| Net Earnings | $3.5 billion | $4.4 billion |
| Earnings per Share | $6.23 | $7.28 |
| Total Adjusted Revenues | $13.5 billion | $14.9 billion |
| Total Benefits and Claims | $5.5 billion | $6.1 billion |
| Shareholders' Equity | $24.8 billion | $22.0 billion |
Shareholder Information
In the first nine months of 2024, Aflac repurchased $2.1 billion worth of shares, equating to 23.4 million shares. As of September 30, 2024, the company had 54.3 million shares remaining authorized for repurchase.
Market Position and Strategic Initiatives
Aflac's strategic initiatives focus on expanding its product offerings and enhancing customer service. The company emphasizes innovation in its insurance products, particularly in the areas of cancer and medical insurance, which have seen significant sales growth.
Product Sales Performance
| Product Category | New Annualized Premium Sales (2024) | New Annualized Premium Sales (2023) |
|---|---|---|
| Cancer Insurance | 55.1% | 65.6% |
| Medical Insurance | 12.2% | 20.0% |
| Life Insurance | 30.8% | 6.1% |
| Other Products | 2.0% | 8.3% |
International Operations
Aflac Japan continues to be a significant contributor to the company's overall performance, with over 22 million individual policies in force as of September 30, 2024. The company reported annualized premiums in force of $8.5 billion in Japan.
Future Outlook
Aflac's future outlook remains positive as the company continues to adapt its products to meet changing market demands, particularly in health insurance. The company expects to maintain strong capital levels and enhance its operational efficiency.
How Aflac Incorporated (AFL) Works
Business Overview
Aflac Incorporated (AFL) operates primarily in the supplemental insurance sector, offering policies that provide cash benefits to policyholders when they are diagnosed with certain medical conditions or suffer from accidents. The company is well-known for its cancer and critical illness insurance products, particularly in Japan and the United States.
Financial Performance
As of the third quarter of 2024, Aflac reported total revenues of $2.9 billion, a decline from $5.0 billion in the same quarter of 2023. Net earnings for the third quarter of 2024 were a loss of $(93) million, or $(0.17) per diluted share, compared to a profit of $1.6 billion, or $2.64 per diluted share in Q3 2023.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Revenues | $2.9 billion | $5.0 billion |
| Net Earnings | $(93) million | $1.6 billion |
| Earnings per Share | $(0.17) | $2.64 |
Investment Performance
During the third quarter of 2024, Aflac recorded pretax net investment losses of $1.4 billion, contrasting with gains of $423 million in Q3 2023. The investment losses included an increase in credit loss allowances of $141 million and net losses from derivatives amounting to $1.4 billion.
Market Operations
In Japan, Aflac reported net earned premiums of $1.7 billion for Q3 2024, down from $2.0 billion in the previous year. Adjusted net investment income in Japan was $662 million, a slight decrease from $679 million in Q3 2023.
| Metric | Q3 2024 (Japan) | Q3 2023 (Japan) |
|---|---|---|
| Net Earned Premiums | $1.7 billion | $2.0 billion |
| Adjusted Net Investment Income | $662 million | $679 million |
U.S. Operations
Aflac's U.S. segment reported net earned premiums of $1.5 billion in Q3 2024, slightly up from $1.4 billion in Q3 2023. The adjusted net investment income for the U.S. segment was $210 million, compared to $209 million in the prior year.
| Metric | Q3 2024 (U.S.) | Q3 2023 (U.S.) |
|---|---|---|
| Net Earned Premiums | $1.5 billion | $1.4 billion |
| Adjusted Net Investment Income | $210 million | $209 million |
Shareholder Activities
In the first nine months of 2024, Aflac repurchased $2.1 billion worth of its common shares, equivalent to approximately 23.4 million shares. As of September 30, 2024, the company had 54.3 million shares remaining authorized for repurchase.
Financial Ratios
The third quarter of 2024 saw total benefits and claims ratio to total adjusted revenues at 41.2%, compared to 30.7% in Q3 2023. The adjusted expense ratio was 38.0% in Q3 2024, down from 40.6% in the same period the previous year.
| Ratio | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Benefits and Claims Ratio | 41.2% | 30.7% |
| Adjusted Expense Ratio | 38.0% | 40.6% |
Exchange Rate Impacts
The average yen/dollar exchange rate for the three-month period ended September 30, 2024, was 147.95, a 2.0% decrease from 144.97 in the same period of 2023. The nine-month average was 150.60, down 8.1% from 138.38 in 2023.
Conclusion of Financial Data
As of September 30, 2024, Aflac's shareholders' equity was $24.8 billion, or $44.60 per share, up from $22.0 billion, or $38.00 per share at the end of 2023. The annualized return on average shareholders' equity was (1.5)% for Q3 2024.
How Aflac Incorporated (AFL) Makes Money
Revenue Streams
Aflac Incorporated generates revenue primarily through two segments: Aflac Japan and Aflac U.S. The company focuses on supplemental health insurance products, which provide financial protection against medical expenses.
| Segment | Net Earned Premiums (2024 Q3) | Total Adjusted Revenues (2024 Q3) | Net Investment Income (2024 Q3) |
|---|---|---|---|
| Aflac Japan | $1,709 million | $2,378 million | $662 million |
| Aflac U.S. | $1,459 million | $1,684 million | $210 million |
| Corporate and Other | N/A | $225 million | N/A |
| Total | $3,168 million | $4,287 million | $872 million |
Net Investment Income
Aflac's investment strategy is focused on generating stable income through diversified portfolios, including fixed maturity securities and equity investments. In the first nine months of 2024, the adjusted net investment income was $3.1 billion compared to $2.9 billion in the same period of 2023.
Claims and Expenses
The total benefits and claims for Aflac in Q3 2024 were $2,003 million, which reflects an increase in incurred claims. The ratio of total benefits and claims to total adjusted revenues was 41.2% for the third quarter of 2024, compared to 30.7% in the same quarter of the previous year.
| Ratio | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Benefits and Claims | 41.2% | 30.7% |
| Adjusted Expenses | 38.0% | 40.6% |
| Pretax Adjusted Earnings | 20.8% | 28.8% |
Sales Performance
New annualized premium sales for Aflac U.S. in Q3 2024 were $379 million, representing a 5.5% increase from $359 million in Q3 2023. The main drivers were group life and disability products.
| Product Category | New Annualized Premium Sales (Q3 2024) | New Annualized Premium Sales (Q3 2023) |
|---|---|---|
| Accident | 17.7% | 19.9% |
| Disability | 28.8% | 28.2% |
| Critical Care | 18.6% | 18.6% |
| Hospital Indemnity | 11.9% | 12.6% |
Foreign Exchange Impact
Aflac's financial performance is also influenced by foreign currency exchange rates, particularly the yen/dollar exchange rate. For Q3 2024, the average exchange rate was 147.95 yen to 1 dollar, which impacted the adjusted earnings per share negatively by $0.03.
Shareholder Returns
Aflac has been active in returning capital to shareholders. In the first nine months of 2024, the company repurchased $2.1 billion worth of shares, equating to approximately 23.4 million shares. The remaining shares authorized for repurchase total 54.3 million.
Financial Summary
In summary, Aflac's financial results for the first nine months of 2024 showed total revenues of $13.5 billion, down from $14.9 billion in the same period of 2023. Net earnings were $3.5 billion, or $6.23 per diluted share, compared to $4.4 billion, or $7.28 per diluted share, in the prior year.
| Financial Metric | 2024 YTD | 2023 YTD |
|---|---|---|
| Total Revenues | $13.5 billion | $14.9 billion |
| Net Earnings | $3.5 billion | $4.4 billion |
| Earnings per Share | $6.23 | $7.28 |
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Article updated on 8 Nov 2024
Resources:
- Aflac Incorporated (AFL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Aflac Incorporated (AFL)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Aflac Incorporated (AFL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.